The western producer july 7, 2016

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THURSDAY, JULY 7, 2016

VOL. 94 | NO. 27 | $4.25

WORKING SAFELY IN BEAR COUNTRY P31

SERVING WESTERN CANADIAN FARM FAMILIES SINCE 1923

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WWW.PRODUCER.COM

EXPORTS

What’s behind pulses’ shift to bulk exports? Bulk shipping rates drop to historic lows BY SEAN PRATT SASKATOON NEWSROOM

SEE BULK EXPORTS, PAGE 4

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A container ship was anchored recently at the Mersin International Port in Mersin Turkey. A new berth is set to open later this year. It will increase the port’s capacity to 2.6 million 20-foot-equivalent units (TEU) from 1.8 million TEU, making Mersin the biggest container port in Turkey. The new berth will be able to accommodate the world’s largest container ships, which have an 18,000 TEU capacity. | SEAN PRATT PHOTO

TRANSPORTATION

Branch-line abandonment rules urged for elevators BY BRIAN CROSS SASKATOON NEWSROOM

Governments should regulate the abandonment and demolition of prairie grain elevators similar to how they regulate rail line abandonment and removal, says the head of a community group trying to save an elevator in Raymore, Sask. Terry Fazakas says governments should require grain companies to offer mothballed elevators and other grainhandling assets for sale to interested parties before demol-

ishing them. Raymore’s concrete elevator is slated for demolition. Fazakas has approached the elevator’s owner, Cargill Canada, with an offer to buy, but Cargill officials said last week the facility is not for sale and it will be demolished. “It should be just like rail-line abandonment,” said Fazakas. “If they don’t want to operate it, that’s fine but what is the reason that they don’t want to sell it? Is it competition?” Fazakas has been leading local

efforts to buy the elevator but so far, his efforts have hit a stonewall. When Fazakas initially expressed an interest, Cargill told him he would need to submit a business plan and a formal proposal. Since then, he has been told that Cargill is not interested in selling. The elevator sits on leased land owned by Canadian National Railway. CN has also indicated that it is not interested in selling the land. SEE ABANDONMENT RULES, PAGE 5

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CAN ORGANICS FEED THE WORLD? ENVIRONMENTAL GROUPS SAY YES BUT REPORT HAS DETRACTORS | PAGE 3

The Europe problem

Beef border:

Glyphosate approval received an 11th hour extension in the European Union, but trouble is still brewing. | Page 15

Mexico agrees to accept beef from Canadian cattle older than 30 months. | Page 13

u|xhHEEJBy00001pzYv-:= JULY 7, 2016 Return undeliverable Canadian addresses to: Box 2500, Stn. Main, Saskatoon, SK. S7K 2C4 The Western Producer is published in Saskatoon by Western Producer Publications, which is owned by GVIC Communications Corp. Publisher: Shaun Jessome Publications Mail Agreement No. 40069240

Bulk is king when it comes to ocean freight, says a grain transportation expert. Bulk shipping rates are at historically low levels, said Mark Hemmes, president of Quorum Corp., the government appointed grain monitor. Panamax vessels are renting out for $4,000 to $4,500 per day compared to more than $90,000 during the heyday of 2007 and 2008, when China was importing vast quantities of steel. Rates began to plummet following the 2008 global economic meltdown, falling as low as $2,500 to $2,800 per day last winter as ships ordered to be built during the peak shipping period continue to hit the high seas. “Anybody who is alive today has never seen bulk ocean rates this low,” Hemmes said. Container shipping rates have also dropped but not by the same magnitude as bulk. Hemmes said that is because container companies such as A.P. Moller-Maersk, Orient Overseas C o nt a i n e r L i n e ( O O C L ) a n d Hapag-Lloyd are mammoth corporations that own hundreds of vessels. They can afford to idle a portion of their fleet, anchoring the ships in a safe port with a skeleton crew. “ They can afford to manage capacity,” he said. “The supply and demand relationship isn’t as severe as it is with a bulk vessel.” Bulk vessel companies are small by comparison. The big ones may own a dozen ships. “I wouldn’t put them in the category of mom and pop because a Panamax vessel costs about $80 million, but they’re not in the same league as, say OOCL or Maersk, or somebody like that,” said Hemmes.


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The western producer july 7, 2016 by The Western Producer - Issuu